Warren Buffett bought Precision Castparts for $37 billion in 2016. He immediately announced he overpaid. Spent a decade telling shareholders he f*cked up. Now the metal castings division is profitable and everyone pretends this validates something about patience.
It validates nothing.
You bought high. You admitted you bought high. The asset later became worth more because airplane manufacturers needed complex metal parts during a supply chain crisis you could not have predicted. This is not wisdom. This is waiting.
Berkshire Hathaway could have bought any troubled industrial manufacturer in 2016, overpaid by $10 billion, waited ten years, and claimed vindication when global logistics collapsed and reshoring became fashionable. Precision Castparts makes specialized aerospace components. Lockheed Martin needs them. Boeing needs them. They would have needed them whether Buffett bought the company or lit $37 billion on fire in his driveway.
The financial press calls this patience. Retail traders will read this headline and convince themselves that overpaying for assets is fine if you just white-knuckle through a decade of underperformance. They will buy shares of whatever dogsh*t SPAC merger their cousin mentioned at Thanksgiving. They will check the price every morning for eight years. They will tell themselves they are being patient like Warren.
They are not being patient like Warren. Warren Buffett runs a $900 billion conglomerate with operating income from insurance float and BNSF Railway. They run a Robinhood account with $4,300 in it and a Tesla call expiring Friday.
Precision Castparts is now worth the premium Buffett paid because defense contractors need turbine blades, not because he saw the future. The man bought at the top and held until the top came back to him. Riveting.
Photo by Aidan Tottori on Unsplash
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